Objectives to Manage The Risk of Structural Balance In Banking
The objectives of the management of assets and liabilities are different, but the principal is to protect both the financial margin as the economic value of the entity, to movements in interest rates in exchange rates and relative liquidity. To do this, ex-ante, facilitates investment decisions and debt that are consistent and optimal with profitability and risk levels that each entity is willing to assume.
Another equally important objective is the empowerment, ex post, income generation through sequential execution of investment strategies, arbitration or coverage within predefined risk levels by senior management of each entity. For this, the asset and liability management seeks to adapt the structural risk profile changes as they occur in markets where it operates in the state.
Thus, the responses to these changes in the various markets in which it operates determine the style of management of each entity, whose range goes from pro-active attitudes, by which the managers of the entity are expected to market or even lead it, to re-active attitudes, where managers only accommodate changes in the markets.
In any case, it is essential that senior management of each entity clearly know the style used by their managers or managers at all times, therefore this condition the level of structural risk exposure, and products being offered and also products under procurement.
